Ubisoft 2006 Annual Report Download - page 161

REPORT OF THE CHAIRMAN OF THE BOARD OF DIRECTORS
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This reporting procedure also makes it possible to measure
each subsidiary’s performance and contribution to the
group’s results. For certain operational information,
management has daily access to data.
Meetings of the group’s general management, which are
attended by the Administrative, Finance and Financial
Control departments, among others, are held to review
the various reporting indicators, analyze discrepancies
between the actual accounts and initial forecasts, and fine-
tune the half-yearly and annual forecasts on the basis of
actual results.
Responsibilities are distributed among these three divi-
sions in order to facilitate quality control of accounting
and financial data.
A forecasting tool to support performance
The HFM consolidation tool is used for financial forecas-
ting.
Each of the group entities’ earnings forecasts are consoli-
dated in a centralized application to allow:
analysis at the entity level or for a specific line item,
comparisons between actual results and forecasts,
monthly, quarterly or other analyses.
The tool is used by all the group’s entities, which allows a
comprehensive view of the group. The subsidiaries are res-
ponsible for sending the group reliable reports that com-
ply with the procedures related to the requested financial
information.
6.2.5.2 Accounting and
financial information control
procedures
Reliability of accounting and financial information
Ubisoft's accounting and financial information is prepared
by Administrative Management under the control of the
Chief Executive Officer, with final approval being the pre-
rogative of the Board of Directors.
Each subsidiary’s accounts are prepared by the local
accounting departments under their director’s supervi-
sion. The half-yearly financial statements are subject to a
limited review and the year-end closing is audited by the
auditors of each entity. Accounting information is sent to
the Consolidation Department on the basis of a timetable
defined by Administrative Management.
The company has invested in resources to simplify and
increase the reliability of the process of producing the
consolidated financial statements.
The group uses Hyperion’s HFM tool for the collection and
monthly reconciliation of the subsidiaries’ accounting
data. This tool is used to automatically perform checks and
tests of reasonableness on cash flows, the balance sheet,
certain income statement accounts, and so on.
It allows fast, reliable data transmission and helps optimize
the security of the consolidated financial statements.
The consolidated financial statements are subject to a limi-
ted review on September 30 and an audit on March 31 by
the group's auditors. Periodic reviews throughout the fis-
cal year allow a preliminary analysis of specific accounting
issues.
This systematic review process facilitates the early detec-
tion of any problems prior to the year-end closing, and
reduces the time needed to prepare the consolidated
financial statements.
In an ongoing effort to improve the performance of its
information system and meet the needs of a fast-growing
group in terms of efficiency, responsiveness and reliabi-
lity, the group is considering implementing a new version
of the consolidation software in the near future.
The Consolidation Department has defined procedures to
allow the subsidiaries to better understand the tools and
use them more effectively:
establishment of a group-wide chart of accounts,
implementation of automatic mapping between the cor-
porate accounts and the consolidated financial state-
ments,
creation of a user manual for the consolidation reporting
package,
development of a consolidation manual,
development of a manual of accounting principles.
All the significant subsidiaries are integrated under
PeopleSoft/Oracle. The group continues to look for solu-
tions that will eventually allow it to integrate an accoun-
ting ERP system at the other foreign subsidiaries.
This deployment is designed to standardize and formalize
the various accounting systems and is in keeping with our
commitment to optimize the efficiency and reliability of
strategic information processing.
This system addresses the local needs of the subsidiaries
and complies with the group’s standards. It provides the
ability to access and compare information at every level
and to manage cash flows, thereby improving coordination
among the departments.
Each subsidiary must apply the existing group-wide proce-
dures as regards monthly reporting, entry of accounting
data, year-end and half-year closings (schedule and for-
mat) and quarterly forecasts.
The objective of all the IT procedures implemented is to
ensure data integration.
The Consolidation Department also collects and verifies
the accounting data mentioned in the group’s financial
announcements as well as data pertaining to the consolida-
ted financial statements.
This data is verified by the company and the auditors.
The group provides quarterly reports on sales and half-
yearly reports on results.
Accounting standards
Application of the IFRS standards is mandatory for annual
financial statements published as of January 1, 2005 for
listed EEC companies. For Ubisoft, presentation of the
consolidated financial statements in accordance with the
IAS/IFRS standards applies as of the fiscal year ended
March 31, 2006 and includes a comparison with the fiscal
year ended March 31, 2005.
Starting on April 1, 2006, the subsidiaries’ monthly
reports are sent in accordance with IFRS and the consoli-
dation reporting packages are audited according to these
same standards.